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EXHIBIT 10.1
UGI CORPORATION
2000 STOCK INCENTIVE PLAN
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TABLE OF CONTENTS
Section Number Page
1. Purpose and Design............................................. 1
2. Definitions.................................................... 1
3. Maximum Number of Shares Available for Options and
Restricted Stock Grants..................................... 3
4. Duration of the Plan........................................... 3
5. Administration................................................. 4
6. Eligibility.................................................... 4
7. Options........................................................ 4
8. Restricted Stock............................................... 7
9. Dividend Equivalents and Restricted Stock Dividend
Equivalents................................................. 8
10. Requirements for Performance Goals and Performance Periods..... 10
11. Non-Transferability............................................ 11
12. Consequences of a Change of Control............................ 11
13. Adjustment of Number and Price of Shares, Etc.................. 12
14. Limitation of Rights........................................... 13
15. Amendment or Termination of Plan............................... 13
16. Tax Withholding................................................ 13
17. Governmental Approval.......................................... 13
18. Effective Date of Plan......................................... 14
19. Successors..................................................... 14
20. Headings and Captions.......................................... 14
21. Governing Law.................................................. 14
(i)
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UGI CORPORATION
2000 STOCK INCENTIVE PLAN
1. PURPOSE AND DESIGN
The purpose of this Plan is to assist the Company in securing and
retaining key corporate executives of outstanding ability, who are in a position
to significantly participate in the development and implementation of the
Company's strategic plans and thereby contribute materially to the long-term
growth, development and profitability of the Company, by affording them an
opportunity to purchase its Stock under options or an opportunity to acquire
stock by the achievement of specific performance goals. The Plan is designed to
align directly long-term executive compensation with tangible, direct and
identifiable benefits realized by the Company's shareholders.
2. DEFINITIONS
Whenever used in this Plan, the following terms will have the
respective meanings set forth below:
2.01 "Board" means UGI's Board of Directors as constituted from
time to time.
2.02 "Change of Control" means a change of control as defined in a
change of control agreement between a Participant's respective employer and
certain of its employees.
2.03 "Committee" means the Compensation and Management Development
Committee of the Board or its successor.
2.04 "Company" means UGI Corporation, a Pennsylvania corporation,
any successor thereto and any Subsidiary.
2.05 "Comparison Group" means the group determined by the
Committee (no later than ninety (90) days after the commencement of a
Performance Period) consisting of the Company and such other companies deemed by
the Committee (in its sole discretion) to be reasonably comparable to the
Company.
2.06 "Date of Grant" means the effective date of an Option or
Restricted Stock grant; provided, however, that no retroactive grants will be
made.
2.07 "Dividend Equivalent" means an amount determined by
multiplying the number of shares of Stock subject to an Option granted in
conjunction with the Dividend Equivalent (whether or not the Option is ever
exercised with respect to any or all shares of Stock subject thereto), subject
to any adjustment under Section 13, by the per-share cash dividend, or the
per-share fair market value (as determined by the Committee) of any dividend in
consideration
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other than cash, paid by the Company on its Stock on a dividend payment date
that falls within the relevant Performance Period. See also "Restricted Stock
Dividend Equivalent."
2.08 "Employee" means a regular full-time salaried employee
(including officers and directors who are also employees) of the Company.
2.09 "Fair Market Value" of Stock means the average of the highest
and lowest sales prices thereof on the New York Stock Exchange on the day on
which Fair Market Value is being determined, as reported on the Composite Tape
for transactions on the New York Stock Exchange. In the event that the New York
Stock Exchange does not express sales prices in decimal form, the average will
be rounded to the next highest one-eighth of a point (.125). Notwithstanding the
foregoing, in the case of a cashless exercise pursuant to Section 7.4(iv), the
Fair Market Value will be the actual sale price of the shares issued upon
exercise of the Option. In the event that there are no Stock transactions on the
New York Stock Exchange on such day, the Fair Market Value will be determined as
of the immediately preceding day on which there were Stock transactions on that
exchange.
2.10 "Option" means the right to purchase Stock pursuant to the
relevant provisions of this Plan at the Option Price for a specified period of
time, not to exceed ten years from the Date of Grant, which period of time will
be subject to earlier termination prior to exercise in accordance with Section
7.3(b) of this Plan.
2.11 "Option Price" means an amount per share of Stock purchasable
under an Option designated by the Committee on the Date of Grant of an Option to
be payable upon exercise of such Option. The Option Price will not be less than
100% of the Fair Market Value of the Stock determined on the Date of Grant.
2.12 "Participant" means an Employee designated by the Committee
to participate in the Plan.
2.13 "Performance Goal" means the objective goal or goals that
must be met in order for Dividend Equivalents and Restricted Stock Dividend
Equivalents, if any, to be paid and restrictions on Restricted Stock to lapse.
All Performance Goals must meet the requirements of Section 10.
2.14 "Performance Period" means the performance period during
which performance will be measured for Performance Goals. Performance Periods
must meet the requirements of Section 10.
2.15 "Plan" means this 2000 Stock Incentive Plan.
2.16 (a) "Restricted Stock" means shares of Stock that are subject
to restrictions which lapse upon the achievement of Performance Goals within the
relevant Performance Period.
2.16 (b) "Restricted Stock Dividend Equivalent" means an amount
determined by multiplying the number of shares of Restricted Stock granted in
conjunction with the Restricted
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Stock Dividend Equivalent, subject to any adjustment under Section 13, by the
per-share cash dividend, or the per-share fair market value (as determined by
the Committee) of any dividend in consideration other than cash, paid by the
Company on its Stock on a dividend payment date that falls within the relevant
Performance Period.
2.17 "Stock" means the Common Stock of UGI or such other
securities of UGI as may be substituted for Stock or such other securities
pursuant to Section 13.
2.18 "Subsidiary" means any corporation or partnership, at least
20% of the outstanding voting stock, voting power or partnership interest of
which is owned respectively, directly or indirectly, by the Company.
2.19 "Termination without Cause" means termination for the
convenience of the Company for any reason other than (i) misappropriation of
funds, (ii) habitual insobriety or substance abuse, (iii) conviction of a crime
involving moral turpitude, or (iv) gross negligence in the performance of
duties, which gross negligence has had a material adverse effect on the
business, operations, assets, properties or financial condition of the Company.
The Committee will have the sole discretion to determine whether a significant
reduction in the duties and responsibilities of a Participant will constitute a
Termination without Cause.
2.20 "UGI" means UGI Corporation, a Pennsylvania corporation or
any successor thereto.
3. MAXIMUM NUMBER OF SHARES AVAILABLE FOR OPTIONS AND RESTRICTED STOCK GRANTS
The number of shares of Stock which may be made the subject of Options
and the number of shares of Restricted Stock that may be granted under this Plan
may not exceed 1,100,000 in the aggregate, subject, however, to the adjustment
provisions of Section 13 below, and provided that the maximum number of
Restricted Shares issued hereunder is 500,000. With regard to grants to any one
individual in a calendar year: (i) the number of shares of Restricted Stock that
may be issued will not exceed 100,000, and (ii) the number of shares of
Restricted Stock together with the number of shares of Stock which may be the
subject of grants of Options will not exceed 500,000. If any Option expires or
terminates for any reason without having been exercised in full or if Restricted
Stock is forfeited, the unpurchased shares subject to the Option or the
forfeited shares of Restricted Stock will again be available for the purposes of
the Plan. Shares of Restricted Stock and shares which are the subject of Options
may be previously issued and outstanding shares of Stock reacquired by the
Company and held in its treasury, or may be authorized but unissued shares of
Stock, or may be a combination of both.
4. DURATION OF THE PLAN
The Plan will remain in effect until all Stock subject to it has been
transferred to Participants or all Options have terminated or been exercised and
all shares of Restricted Stock have been vested or forfeited. Notwithstanding
the foregoing, Options and Restricted Stock may not be granted after December
31, 2009.
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5. ADMINISTRATION
The Plan will be administered by the Committee. Subject to the express
provisions of the Plan, the Committee will have authority, in its complete
discretion, to determine the Employees to whom, and the time or times at which
grants will be made. In making such determinations, the Committee may take into
account the nature of the services rendered by an Employee, the present and
potential contributions of the Employee to the Company's success and such other
factors as the Committee in its discretion deems relevant. Awards under a
particular Section of the Plan need not be uniform as among Participants.
Subject to the express provisions of the Plan, the Committee will also have
authority to construe and interpret the Plan, to prescribe, amend and rescind
rules and regulations relating to it, to determine the terms and provisions of
the respective stock option agreements required by Section 7.2 of the Plan and
the terms and provisions of the restrictions relating to Restricted Stock (none
of which need be identical), and to make all other determinations (including
factual determinations) necessary or advisable for the orderly administration of
the Plan. All ministerial functions, in addition to those specifically delegated
elsewhere in the Plan, shall be performed by a committee comprised of Company
employees ("Administrative Committee") appointed by the Committee.
6. ELIGIBILITY
Grants hereunder may be made only to Employees (including directors who
are also Employees of the Company) who, in the sole judgment of the Committee,
are individuals who are in a position to significantly participate in the
development and implementation of the Company's strategic plans and thereby
contribute materially to the continued growth and development of the Company and
to its future financial success.
7. OPTIONS
7.1 Grant of Options. Subject to the provisions of Sections 2.11 and 3:
(i) Options may be granted to Participants at any time and from time to time as
may be determined by the Committee; and (ii) the Committee will have complete
discretion in determining the Options to be granted, the number of shares of
Stock to be subject to each Option, the Option Price to be paid for the shares
upon the exercise of each Option, the period within which each Option may be
exercised, the vesting schedule associated with the Option, and whether the
Option will include Dividend Equivalents.
7.2 Option Agreement. As determined by the Committee on the Date of
Grant, each Option will be evidenced by a stock option agreement that will,
among other things, specify the Date of Grant, the Option Price, the duration of
the Option, the number of shares of Stock to which the Option pertains, the
Option's vesting schedule, and whether the Option will include Dividend
Equivalents.
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7.3 Exercise and Vesting.
(a) Except as otherwise specified by the Committee in the
stock option agreement, the Option shall become exercisable in equal one-third
(1/3) installments on the first, second and third anniversaries of the Date of
Grant. Notwithstanding the foregoing, in the event that any such Options are not
by their terms immediately exercisable, the Committee may accelerate the
exercisability of any or all outstanding Options at any time for any reason. No
Option will be exercisable on or after the tenth anniversary of the Date of
Grant.
(b) Except as otherwise specified by the Committee, in the
event that a Participant holding an Option ceases to be an Employee, the Options
held by such Participant will terminate on the date such Participant ceases to
be an Employee. The Committee will have authority to determine whether an
authorized leave of absence or absence on military or governmental service will
constitute a termination of employment for the purposes of this Plan. However,
if a Participant holding an Option ceases to be an Employee by reason of (i)
Termination without Cause, (ii) retirement, (iii) disability, or (iv) death, the
Option held by any such Participant will thereafter become exercisable pursuant
to the following:
(i) Termination Without Cause. If a Participant
terminates employment on account of a Termination without Cause, the Option held
by such Participant will thereafter be exercisable only with respect to that
number of shares of Stock with respect to which it is already exercisable on the
date such Participant ceases to be an Employee; and such Option will terminate
upon the earlier of the expiration date of the Option or the expiration of the
13 month period commencing on the date such Participant ceases to be an
Employee.
(ii) Retirement. If a Participant terminates employment
on account of a retirement under the Company's retirement plan applicable to
that Participant, the Option held by such Participant will thereafter become
exercisable as if such Participant had remained employed by the Company for 36
months after the date of such retirement; and such Option will terminate upon
the earlier of the expiration date of the Option or the expiration of such 36
month period. Retirement for Employees of AmeriGas Propane, Inc. ("API") means
termination of employment with API after attaining age 55 with ten or more years
of service with API and its affiliates.
(iii) Disability. If a Participant is determined to be
"disabled" (as defined under the Company's long-term disability plan), the
Option held by such Participant will thereafter become exercisable as if such
Participant had remained employed by the Company for 36 months after the date of
such disability; and such Option will terminate upon the earlier of the
expiration date of the Option or the expiration of such 36 month period.
(iv) Death. In the event of the death of a Participant
while employed by the Company, the Option theretofore granted to such
Participant will be fully and immediately exercisable (to the extent not
otherwise exercisable by its terms) at any time prior to the earlier of the
expiration date of the Option or the expiration of the 12 month period following
the Participant's death. Death of a Participant after such Participant has
ceased to be employed by the Company will not affect the otherwise applicable
period for exercise of the Option determined pursuant to Sections 7.3(b)(i),
7.3(b)(ii) or 7.3(b)(iii). Such Option may be exercised by the
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estate of the Participant, by any person to whom the Participant may have
bequeathed the Option, any person the Participant may have designated to
exercise the same under the Participant's last will, or by the Participant's
personal representatives if the Participant has died intestate.
(c) Notwithstanding anything contained in this Section 7.3,
with respect to the number of shares of Stock subject to an Option with respect
to which such Option is or is to become exercisable, no Option, to the extent
that it has not previously been exercised, will be exercisable after it has
terminated, including without limitation, after any termination of such Option
pursuant to Section 7.3(b) hereof.
7.4 Payment. The Option Price upon exercise of any Option will be
payable to the Company in full (i) in cash or its equivalent, (ii) by tendering
shares of previously acquired Stock already beneficially owned by the
Participant for more than one year and having a Fair Market Value at the time of
exercise equal to the Option Price being paid thereby, (iii) by applying
Dividend Equivalents payable to the Participant in accordance with Section 8 of
the Plan in an amount equal to the total Option Price, (iv) by payment through a
broker in accordance with procedures permitted by Regulation T of the Federal
Reserve Board, (v) by such other method as the Committee may approve, or (vi) by
a combination of (i), (ii), (iii), (iv) and/or (v). The cash proceeds from such
payment will be added to the general funds of the Company and will be used for
its general corporate purposes.
7.5 Written Notice. A Participant wishing to exercise an Option must
give written notice to the Company in the form and manner prescribed by the
Administrative Committee, indicating the date of award, the number of shares as
to which the Option is being exercised, and such other information as may be
required by the Administrative Committee. Full payment for the shares pursuant
to the Option must be received by the close of business on the day the Option is
exercised. Except as provided in Section 7.3(b), no Option may be exercised at
any time unless the Participant is then an Employee of the Company.
7.6 Issuance of Stock. As soon as practicable after the receipt of
written notice and payment, the Company will, without stock transfer taxes to
the Participant or to any other person entitled to exercise an Option pursuant
to this Plan, deliver to, or credit electronically on behalf of, the
Participant, the Participant's designee or such other person the requisite
number of shares of Stock.
7.7 Privileges of a Shareholder. A Participant or any other person
entitled to exercise an Option under this Plan will have no rights as a
shareholder with respect to any Stock covered by the Option until the due
exercise of the Option and issuance of such Stock.
7.8 Partial Exercise. An Option granted under this Plan may be
exercised as to any lesser number of shares than the full amount for which it
could be exercised. Such a partial exercise of an Option will not affect the
right to exercise the Option from time to time in accordance with this Plan as
to the remaining shares subject to the Option.
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8. RESTRICTED STOCK
8.1 Grant of Restricted Stock. Subject to the provisions of Section 3,
shares of Restricted Stock and Restricted Stock Dividend Equivalents may be
granted to Participants at any time and from time to time as may be determined
by the Committee. Shares of Restricted Stock may be granted with or without
Restricted Stock Dividend Equivalents as determined by the Committee. Shares
issued or transferred pursuant to Restricted Stock awards may be issued or
transferred for consideration or for no consideration, and will be subject to
Performance Goals meeting the requirements of Section 10.
8.2 Requirement of Employment or Service. If the Participant ceases to
be employed by, or provide service to, the Company before the Performance Goals
are met, the Restricted Stock award will terminate as to all shares covered by
the grant as to which the restrictions have not lapsed, and those shares of
Stock must be immediately returned to the Company. However, if a Participant
holding Restricted Stock ceases to be an Employee by reason of (i) retirement,
(ii) disability, or (iii) death, the restrictions on Restricted Stock held by
any such Participant will lapse pursuant to the following:
(a) Retirement. If a Participant terminates employment on
account of a retirement under the Company's retirement plan applicable to that
Participant, the restrictions on such Participant's Restricted Stock will lapse
with regard to any Performance Period that ends within 36 months after the date
of such retirement; provided that the Performance Goals associated with such
Performance Period are achieved within that 36 month period. Retirement for
Employees of AmeriGas Propane, Inc. ("API") means termination of employment with
API after attaining age 55 with ten or more years of service with API and its
affiliates.
(b) Disability. If a Participant is determined to be
"disabled" (as defined under the Company's long-term disability plan), the
restrictions on such Participant's Restricted Stock will lapse with regard to
any Performance Period that ends within 36 months after the date of such
disability; provided that the Performance Goals associated with such Performance
Period are achieved within that 36 month period.
(c) Death. In the event of the death of a Participant while
employed by the Company, the restrictions on such Participant's Restricted Stock
will lapse at the end of the Performance Period associated with such Restricted
Stock upon the achievement of the related Performance Goals.
8.3 Restrictions on Transfer and Legend on Stock Certificate. Until the
Performance Goals are met, a Participant may not sell, assign, transfer, pledge
or otherwise dispose of the shares of Restricted Stock or rights to Restricted
Stock Dividend Equivalents, if any. Each certificate for a share of a Restricted
Stock will contain a legend giving appropriate notice of the restrictions in the
grant. The Participant will be entitled to have the legend removed from the
stock certificate covering the shares subject to restrictions when all
restrictions on such shares have lapsed. The Administrative Committee may
determine that the Company will not issue certificates for Restricted Stock
until all restrictions on such shares have lapsed, or that the
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Company will retain possession of certificates for shares of Restricted Stock
until all restrictions on such shares have lapsed.
8.4 Privileges of a Shareholder. Unless the Committee determines
otherwise, during the Performance Period, a Participant issued certificates
under Section 8.3 will have the right to vote shares of Restricted Stock and to
receive any dividends or other distributions paid on such shares, subject to any
restrictions deemed appropriate by the Committee.
8.5 Form of Payment for Restricted Stock. The Committee will have the
sole discretion to determine whether the Company's obligation in respect of
payment of Restricted Stock awards for a Participant who is not issued
certificates under Section 8.3 will be paid in Stock, solely in cash or partly
in Stock and partly in cash.
9. DIVIDEND EQUIVALENTS AND RESTRICTED STOCK DIVIDEND EQUIVALENTS
9.1 (a) Amount of Dividend Equivalents Credited. If the Committee so
specifies, as of the Date of Grant in the stock option agreement, from the Date
of Grant of an Option to a Participant (or, in the case of an Option granted
after the date of commencement of a Performance Period to a new Participant or
to a Participant with changed responsibilities, in which event, from such date
not earlier than the date of commencement of the Performance Period as is
designated by the Committee) until the earlier of (i) the end of the applicable
Performance Period or (ii) the date of disability, death or termination of
employment for any reason (including retirement), of a Participant, the Company
will keep records for such Participant ("Account") and will credit on each
payment date for the payment of a dividend made by UGI on its Stock an amount
equal to the Dividend Equivalent associated with such Option. Notwithstanding
the foregoing, a Participant may not accrue during any calendar year Dividend
Equivalents in excess of $1,000,000. Except as set forth in Section 9.5 below,
no interest will be credited to any such Account.
9.1 (b) Amount of Restricted Stock Dividend Equivalents Credited. If
the Committee so specifies when granting Restricted Stock, from the Date of
Grant of Restricted Stock to a Participant (or, in the case of Restricted Stock
granted after the date of commencement of a Performance Period to a new
Participant or to a Participant with changed responsibilities, in which event,
from such date not earlier than the date of commencement of the Performance
Period as is designated by the Committee) until the earlier of (i) the end of
the applicable Performance Period or (ii) the date of disability, death or
termination of employment for any reason (including retirement), of a
Participant, the Company will keep records for such Participant ("Account") and
will credit on each payment date for the payment of a dividend made by UGI on
its Stock an amount equal to the Restricted Stock Dividend Equivalent associated
with such Restricted Stock. Notwithstanding the foregoing, a Participant may not
accrue during any calendar year Restricted Stock Dividend Equivalents in excess
of $1,000,000. No interest will be credited to any such Account.
9.2 Payment of Credited Dividend Equivalents and Restricted Stock
Dividend Equivalents. Payment of Dividend Equivalents and Restricted Stock
Dividend Equivalents will be made only upon the determination by the Committee
that the Performance Goals associated
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with such Dividend Equivalents and Restricted Stock Dividend Equivalents have
been achieved as prescribed in accordance with Section 10.
9.3 Timing of Payment of Dividend Equivalents and Restricted Stock
Dividend Equivalents.
(a) Except as otherwise determined by the Committee, in the
event of the (i) termination of an Option prior to exercise pursuant to Section
7.3(b) hereof, or (ii) acceleration of the exercise date of an Option pursuant
to Section 7.3(a) hereof, in either case prior to the end of the applicable
Performance Period, no payments of Dividend Equivalents associated with any
Option will be made (A) prior to the end of the applicable Performance Period
and (B) to any Participant whose employment by the Company terminates prior to
the end of the applicable Performance Period for any reason other than
retirement under the Company's retirement plan, death, disability or Termination
without Cause. As soon as practicable after the end of such Performance Period,
the Committee will certify and announce the results for each Performance Period
prior to any payment of Dividend Equivalents and unless a Participant will have
made an election under Section 9.6 to defer receipt of any portion of such
amount, a Participant will receive the aggregate amount of Dividend Equivalents
payable to that Participant in the form specified by the Committee.
(b) Except as otherwise determined by the Committee, in the
event of the termination of a grant of Restricted Stock pursuant to Section 8.2
hereof, no payments of Restricted Stock Dividend Equivalents associated with
Restricted Stock will be made (A) prior to the end of the applicable Performance
Period and (B) to any Participant whose employment by the Company terminates
prior to the end of the applicable Performance Period for any reason other than
retirement under the Company's retirement plan, death or disability. As soon as
practicable after the end of such Performance Period, the Committee will certify
and announce the results for each Performance Period prior to any payment of
Restricted Stock Dividend Equivalents and unless a Participant will have made an
election under Section 9.6 to defer receipt of any portion of such amount, a
Participant will receive the aggregate amount of Restricted Stock Dividend
Equivalents payable to that Participant in cash.
(c) Notwithstanding anything to the contrary in this Section
9.3, unless a payment of Dividend Equivalents associated with an Option is being
made upon full exercise or termination of such Option, no Dividend Equivalents
will be paid (either at the end of the applicable Performance Period or on a
date such Dividend Equivalents are scheduled to be paid pursuant to a deferral
election) if the average Fair Market Value of Stock for a period of thirty (30)
consecutive business days immediately preceding the end of the applicable
Performance Period or the date such deferred payment is scheduled to be made (as
the case may be) is less than the exercise price of the Option to which such
Dividend Equivalents were associated, and such payment will instead be made at
the earlier of (i) such time as the average Fair Market Value of Stock over a
period of ninety (90) consecutive business days thereafter exceeds the exercise
price of such Option, or (ii) the termination or expiration date of such Option.
9.4 Form of Payment for Dividend Equivalents. The Committee will have
the sole discretion to determine whether the Company's obligation in respect of
payment of Dividend
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Equivalents will be paid solely in credits to be applied toward payment of the
Option Price, solely in cash or partly in such credits and partly in cash.
9.5 Interest on Dividend Equivalents. From a date which is thirty (30)
days after the end of the applicable Performance Period until the date that all
Dividend Equivalents associated with such Option and payable to a Participant
are paid to such Participant, the Account maintained by the Company in its books
and records with respect to such Dividend Equivalents will be credited with
interest at a market rate determined by the Administrative Committee. The
interest rate will be no higher than the prime interest rate as quoted in the
Wall Street Journal on the last day of the month preceding the end of the
Performance Period, or the preceding business day if the last day of the month
is not a business day.
9.6 Deferral of Dividend Equivalents and Restricted Stock Dividend
Equivalents. A Participant will have the right to defer receipt of any Dividend
Equivalent or Restricted Stock Dividend Equivalent payments associated with an
Option or Restricted Stock if the Participant elects to do so on or prior to
December 31 of the year preceding the beginning of the last full year of the
applicable Performance Period (or such other time as the Administrative
Committee will determine is appropriate to make such deferral effective under
the applicable requirements of federal tax laws). The terms and conditions of
any such deferral (including the period of time thereof) will be subject to
approval by the Administrative Committee and all deferrals will be made on a
form provided a Participant for this purpose.
10. REQUIREMENTS FOR PERFORMANCE GOALS AND PERFORMANCE PERIODS
10.1 Designation as Qualified Performance-Based Compensation. Grants of
Restricted Stock, Restricted Stock Dividend Equivalents and Dividend Equivalents
will qualify as "qualified performance-based compensation" under Section 162(m)
of the Internal Revenue Code ("Code"), including the requirement that the
achievement of the goals be substantially uncertain at the time they are
established and that the goals be established in such a way that a third party
with knowledge of the relevant facts could determine whether and to what extent
the Performance Goals have been met. The Committee will not have discretion to
increase the amount of compensation that is payable upon achievement of the
designated Performance Goals, but may, in its sole discretion, reduce the amount
of compensation that is payable upon achievement of the designated Performance
Goals.
10.2 Requirements for Performance Goals. When Restricted Stock,
Restricted Stock Dividend Equivalents and Dividend Equivalents are granted, the
Committee will establish in writing Performance Goals either before the
beginning of the Performance Period or during a period ending no later than the
earlier of (i) 90 days after the beginning of the Performance Period or (ii) the
date on which 25% of the Performance Period has elapsed, or such other date as
may be required or permitted under applicable regulations under Section 162(m)
of the Code. The Performance Goal must specify (A) the objective Performance
Goal(s) that must be met in order for restrictions on the Restricted Stock to
lapse or the Restricted Stock Dividend Equivalents or Dividend Equivalents to be
paid, (B) the Performance Period during which the Performance Goals must be met,
(C) the maximum amounts that may be paid if the Performance Goals are met, and
(D) any other conditions that the Committee deems appropriate and consistent
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with the Plan and the requirements of Section 162(m) of the Code for qualified
performance based compensation.
10.3 Criteria Used for Performance Goals. The Committee will use
objectively determinable Performance Goals based on one or more of the following
criteria: stock price, earnings per share, net earnings, operating earnings,
return on assets, shareholder return, return on equity, growth in assets, unit
volume, sales, cash flow, market share, relative performance to a Comparison
Group, or strategic business criteria consisting of one or more objectives based
on meeting specified revenue goals, market penetration goals, geographic
business expansion goals, cost targets or goals relating to acquisitions or
divestitures. The Performance Goals may relate to the Participant's business
unit or the performance of the Company and its subsidiaries as a whole, or any
combination of the foregoing. Performance Goals need not be uniform as among
Participants.
10.4 Announcement of Grants. The Committee will certify and announce
the results for each Performance Period to all Participants as promptly as
practicable following the completion of the Performance Period. If and to the
extent that the Committee does not certify that the Performance Goals have been
met, the applicable grants of Restricted Stock, Restricted Stock Dividend
Equivalents and Dividend Equivalents for the Performance Period will be
forfeited.
11. NON-TRANSFERABILITY
No Option, shares of Restricted Stock, rights to Restricted Stock
Dividend Equivalents, Dividend Equivalents or other rights granted under the
Plan will be transferable otherwise than by will or the laws of descent and
distribution, and an Option may be exercised, during the lifetime of the
Participant, only by the Participant.
12. CONSEQUENCES OF A CHANGE OF CONTROL
12.1 Notice and Acceleration. Upon a Change of Control, unless the
Committee determines otherwise, (i) the Company will provide each Participant
with outstanding grants written notice of such Change of Control, (ii) all
outstanding Options will automatically accelerate and become fully exercisable,
(iii) the restrictions and conditions on all outstanding Restricted Stock grants
will immediately lapse, and (iv) Dividend Equivalents and Restricted Stock
Dividend Equivalents will become payable in cash in such amounts as the
Committee may determine.
12.2 Assumption of Grants. Upon a Change of Control where the Company
is not the surviving corporation (or survives only as a subsidiary of another
corporation), unless the Committee determines otherwise, all outstanding Options
that are not exercised will be assumed by, or replaced with comparable options
or rights by, the surviving corporation (or a parent of the surviving
corporation), and other outstanding grants will be converted to similar grants
of the surviving corporation (or a parent of the surviving corporation).
12.3 Other Alternatives. Notwithstanding the foregoing, subject to
Section 12.4 below, in the event of a Change of Control, the Committee may take
any of the following actions with
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respect to any or all outstanding Options: the Committee may (i) require that
Participants surrender their outstanding Options in exchange for a payment by
the Company, in cash or Stock as determined by the Committee, in an amount equal
to the amount by which the then Fair Market Value of the shares of Stock subject
to the Participant's unexercised Options exceeds the Option Price of the
Options, as applicable, or (ii) after giving Participants an opportunity to
exercise their outstanding Options, terminate any or all unexercised Options at
such time as the Committee deems appropriate. Such surrender, termination or
settlement will take place as of the date of the Change of Control or such other
date as the Committee may specify.
12.3 Committee. The Committee making the determinations under this
Section 12 following a Change of Control must be comprised of the same members
as those on the Committee immediately before the Change of Control. If the
Committee members do not meet this requirement, the automatic provisions of
Sections 12.1 and 12.2 will apply, and the Committee will not have discretion to
vary them.
12.4 Limitations. Notwithstanding anything in the Plan to the contrary,
in the event of a Change of Control, the Committee will not have the right to
take any actions described in the Plan (including without limitation actions
described in this Section 12) that would make the Change of Control ineligible
for pooling of interests accounting treatment or that would make the Change of
Control ineligible for desired accounting treatment if, in the absence of such
right, the Change of Control would qualify for such treatment and the Company
intends to use such treatment with respect to the Change of Control.
13. ADJUSTMENT OF NUMBER AND PRICE OF SHARES, ETC.
Notwithstanding anything to the contrary in this Plan, in the event any
recapitalization, reorganization, merger, consolidation, spin-off, combination,
repurchase, exchange of shares or other securities of UGI, stock split or
reverse split, extraordinary dividend, liquidation, dissolution, significant
corporate transaction (whether relating to assets or stock) involving UGI, or
other extraordinary transaction or event affects Stock such that an adjustment
is determined by the Committee to be appropriate in order to prevent dilution or
enlargement of Participants' rights under the Plan, then the Committee may, in a
manner that is equitable, adjust (i) any or all of the number or kind of shares
of Stock reserved for issuance under the Plan, (ii) the maximum number of shares
of Stock which may be the subject of grants to any one individual in any
calendar year, (iii) the number or kind of shares of Stock to be subject to
grants of Restricted Stock and Options thereafter granted under the Plan, (iv)
the number and kind of shares of Stock issuable upon exercise of outstanding
Options, (v) the Option Price per share thereof, (vi) the number of shares of
Restricted Stock, (vii) the terms and conditions applicable to Restricted Stock,
and/or (viii) the terms and conditions applicable to Dividend Equivalents and
Restricted Stock Dividend Equivalents, provided that the number of Restricted
Shares and the number of shares subject to any Option will always be a whole
number. Any such determination of adjustments by the Committee will be
conclusive for all purposes of the Plan and of each Option and grant of
Restricted Stock, whether a stock option agreement or grant letter with respect
to a particular Option or grant of Restricted Stock has been theretofore or is
thereafter executed.
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14. LIMITATION OF RIGHTS
Nothing contained in this Plan will be construed to give an Employee
any right to a grant hereunder except as may be authorized in the discretion of
the Committee. A grant under this Plan will not constitute or be evidence of any
agreement or understanding, expressed or implied, that the Company will employ a
Participant for any specified period of time, in any specific position or at any
particular rate of remuneration.
15. AMENDMENT OR TERMINATION OF PLAN
Subject to Board approval, the Committee may at any time, and from time
to time, alter, amend, suspend or terminate this Plan without the consent of the
Company's shareholders or Participants, except that any such alteration,
amendment, suspension or termination will be subject to the approval of the
Company's shareholders within one year after such Committee and Board action if
such shareholder approval is required by any federal or state law or regulation
or the rules of any stock exchange or automated quotation system on which the
Stock is then listed or quoted, or if the Committee in its discretion determines
that obtaining such shareholder approval is for any reason advisable. No
termination or amendment of this Plan may, without the consent of the
Participant to whom any Option or Restricted Share has previously been granted,
adversely affect the rights of such Participant under such Option or Restricted
Share, including any associated Dividend Equivalents or Restricted Stock
Dividend Equivalents. Notwithstanding the foregoing, the Administrative
Committee may make minor amendments to this Plan which do not materially affect
the rights of Participants or significantly increase the cost to the Company.
16. TAX WITHHOLDING
Upon the lapse of restrictions on Restricted Stock and upon exercise of
any Option under this Plan, the Company will require the recipient of the Stock
to remit to the Company an amount sufficient to satisfy federal, state and local
withholding tax requirements. However, to the extent authorized by rules and
regulations of the Administrative Committee, the Company may withhold or receive
Stock and make cash payments in respect thereof in satisfaction of a recipient's
tax obligations in an amount that does not exceed the recipient's minimum
applicable withholding tax obligations. In the event the Company receives Stock
in satisfaction of a recipient's minimum applicable withholding tax obligations,
the Stock must have been held by the recipient for more than six months.
17. GOVERNMENTAL APPROVAL
Each share of Restricted Stock and each Option will be subject to the
requirement that if at any time the listing, registration or qualification of
the shares covered thereby upon any securities exchange, or under any state or
federal law, or the consent or approval of any governmental regulatory body, is
necessary or desirable as a condition of or in connection with the granting of
such Restricted Share or Option or the purchase of shares thereunder, no such
Option may be exercised in whole or in part unless and until such listing,
registration,
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qualification, consent or approval has been effected or obtained free of any
conditions not acceptable to the Board.
18. EFFECTIVE DATE OF PLAN
18.1 Effective Date. This Plan will become effective as of January 1,
2000, subject to ratification by the Company's shareholders prior to March 31,
2000.
18.2 Shareholder Approval for "Qualified Performance-Based
Compensation." This Plan must be reapproved by the shareholders of UGI no later
than the first shareholders meeting that occurs in the fifth year following the
year in which the shareholders previously approved the provisions of Section 10,
if required by section 162(m) of the Code or the regulations thereunder.
19. SUCCESSORS
This Plan will be binding upon and inure to the benefit of the Company,
its successors and assigns and the Participant and his heirs, executors,
administrators and legal representatives.
20. HEADINGS AND CAPTIONS
The headings and captions herein are provided for reference and
convenience only, shall not be considered part of the Plan, and shall not be
employed in the construction of the Plan.
21. GOVERNING LAW
The validity, construction, interpretation and effect of the Plan and
option agreements issued under the Plan will be governed exclusively by and
determined in accordance with the law of the Commonwealth of Pennsylvania.
Approved by Shareholders of UGI Corporation on February 29, 2000.
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